The solutions and their problems

August 2 2003By Jeni Porter

REMOVE NEGATIVE GEARING

Advocated to curb property investors. Negative gearing enables the investor to rent out property at a loss and to claim the loss against other income, saving tax. When it was briefly removed in the 1980s, rents surged.

CUT STATE STAMP DUTY

Supporters include the federal Treasurer, the HIA and the Real Estate Institute. But states argue that stamp duty pays for hospitals, schools and so on. The fear is that if stamp duty is cut, the saving will simply push property prices up, and cut govrnment services.

RAISE FIRST HOME OWNER'S GRANT");document.write("

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Peter Costello says the $7000 grant has helped 482,000 people into their first homes. But the benefits were largely dissipated in higher housing prices.

BOOST LAND SUPPLY

More land, especially for detached housing, eases demand. But Melbourne's boundary has been set.

EQUITY FINANCE

It splits the cost of a property between the buyer and a financial institution. But it is hard to make this scheme work commercially.